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Top SYNT Bull/Bear Pitches

Submitted April 21, 2017

After Plunging, Syntel Shares Look CheapThe IT specialist’s stock could rise sharply once its health-care and banking clients bounce back."Shares of information-technology specialist Syntel have tumbled nearly 30% since the company’s earnings report… More

The IT specialist’s stock could rise sharply once its health-care and banking clients bounce back.

"Shares of information-technology specialist Syntel have tumbled nearly 30% since the company’s earnings report in mid-February. While there are pressures weighing on Syntel’s business, its shares look cheap after the selloff.

At a recent $16.64, the stock (ticker: SYNT) trades at eight times next year’s earnings, compared with peers Tata Consultancy Services (532540.India) and Infosys (500209.India), which go for an average of roughly 16 times.

Syntel has a high-quality business, and that hasn’t changed. As operations improve, the stock’s discount to peers should narrow.

Syntel has a high concentration of financial-services and health-care customers, which account for roughly two-thirds of its revenue. In the earnings announcement, Syntel reported lower revenue from these customers and warned that weakness will likely persist..."